Tip Tuesdays: How to Set a Financial Goal?

by Vinaya HS on March 30, 2010

in Finance

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Here’s a real example for one of my financial goals.

Goal #1: Eliminate car loan debt

I want to eliminate my car loan debt by December 31, 2010.

Achieving this goal will make me debt-free!

To achieve this goal, I will:

a. Save 1 EMI payment (i.e. Rs X) and an additional amount of Rs Y each month from April, 2010 to November, 2010

b. Save Rs Z (outstanding principal + pre-clousre penalty – (8 x Y)) in December, 2010

Once the EMI has been deducted on December 01, 2010, I will pre-close the outstanding loan balance (Target: December 14, 2010).

It’s Specific, has a Justification, and details concrete Steps. In short, it’s Actionable.

What do you think? How do you set your financial goals?

Tip Tuesdays is my initiative to share practical personal finance tips — every Tuesday. I’d be delighted if you could share a tip or two from your own experiences. Drop a comment to submit your tip. And, as always, do spread the word if you find this useful.




Thanks for reading this article. I'd love to hear your opinion. Please use the comments section below to share your thoughts. I frequently write new articles that also cover several other aspects of personal finance including credit cards, financial goals, health insurance, income tax, life insurance, mutual funds, retirement planning, and much more. You can Subscribe through Email and receive new articles directly in your Inbox or you can Subscribe through the RSS Feed and receive new articles in your feed reader.

{ 6 comments… read them below or add one }

Austin @ TheOrangePaper.com March 31, 2010 at 8:04 AM

Now that’s absolutely specific — you’ve chalked out your goal to the minutest detail. Way to go! All the best :)

Vinaya H S March 31, 2010 at 8:36 AM

Thanks, Austin. The real challenge now is “execution.”

Anoop March 31, 2010 at 8:46 PM

Why take loans in the 1st place? unless and untill its necessary, no loans —-> no financial goals —–> no execution challenges… :D

Anonymous April 6, 2010 at 5:06 PM

its a no-brainers action plan. Nothing great in the plan as any ramiah or thimmappa with little WILL to get rid of debts can chart out such plans. sir, pls write abt the challenges to implement the plan or some baniya ways of investment thru which you can get your car free of cost over a period of time.

Deba July 29, 2010 at 2:19 PM

Hey Vinay ,
Cam across your blog today ,Good Work ,
How is the plan execution going ? Do post an update

Vinaya HS July 29, 2010 at 9:46 PM

I will. I’m throwing everything I can at this goal. I’m almost there. Stay tuned for an update.

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